USD/CAD Holds Near 1.42 After Hot US CPI Lifts Fed Hike Bets
USD/CAD is consolidating gains near 1.42 on Wednesday, 11 November 2026. The pair traded at 1.4215 at about 09:27 GMT, according to Trading Economics. The move follows a hotter US inflation report on Tuesday. It also reflects growing bets that the Federal Reserve could raise rates again in December.
US consumer prices rose 0.4% in October, above forecasts of 0.3%. Core prices rose 0.3% against 0.2% expected. Two-year Treasury yields jumped about 20 basis points. The Canadian dollar, often called the loonie, weakened towards a one-month low. This article covers the data and the two central banks. It also looks at oil prices and key chart levels. The final sections cover the events that may move the pair next.
The information in this article is provided for educational purposes only and does not constitute financial advice. Consult a financial advisor before making investment decisions.
Table of Contents
- USD/CAD Today: The Short Answer
- What the October US CPI Report Showed
- Fed Rate Hike Speculation After the CPI
- The Bank of Canada and the Canadian Side
- Oil Prices and the Canadian Dollar
- USD/CAD Analysis: Technical Picture
- USD CAD 5 Year Performance
- What Drives USD CAD
- Key Events Calendar for USD/CAD
- USD/CAD Forecast and Scenarios
- How to Trade USD CAD Around CPI Data
- Frequently Asked Questions
Risk warning: CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money. This article is general information and should not be treated as investment advice.
USD/CAD Today: The Short Answer
The US dollar is holding most of its post-CPI gains against the Canadian dollar. The main driver is the rate outlook. A hotter inflation print raised the odds of a December Fed hike. That widened the expected gap between US and Canadian interest rates.
Two Canadian factors added pressure. Canada lost jobs for a third month in October. Oil prices also fell sharply in early November, which tends to weigh on a currency linked to energy exports.
Sources: Trading Economics, Trading Economics news, FXStreet via TradingKey, investingLive. Prices change during the day. Past performance is not a reliable indicator of future results.
The pair has climbed about 2.3% from the 1.39 area seen on 4 November. It remains below the October peak of 1.4299. That peak was the highest level for the pair since April 2025.
What the October US CPI Report Showed
The US CPI October 2026 report came out on Tuesday, 10 November, at 08:30 ET (13:30 GMT). It was the main trigger for the latest move in the US dollar vs Canadian dollar exchange rate.
Headline and Core Inflation Beat Forecasts
According to the US Bureau of Labor Statistics, the CPI rose 0.4% on a seasonally adjusted basis in October. That followed a 0.6% rise in September. Core CPI excludes food and energy. It rose 0.3% for a third straight month.
Both figures beat market forecasts. Trading Economics put the headline forecast at 0.3%. The core forecast was 0.2%.
Source: US Bureau of Labor Statistics, CPI news release, October 2026. Seasonally adjusted monthly changes. Past performance is not a reliable indicator of future results.
Shelter accounted for over 30% of the monthly rise. Energy slowed sharply from September. Core prices still rose at a firm pace, which matters most for the Fed.
Why There Is a Gap in the Annual CPI Rate
The BLS did not publish 12-month inflation rates for most series this time. Survey data for October 2025 were never collected during a lapse in government funding. The BLS therefore cannot compare October 2026 with October 2025 for those indexes.
This makes the monthly figures more important for markets. Monthly prints can swing more than annual rates. A single hot month may therefore give a noisy signal.
How the Bond Market Reacted
The US 2 year yield posted its largest one-day rise since 2024, according to Seeking Alpha. Short-dated yields are sensitive to Fed expectations. A rise in them often supports the US dollar.
Source: Seeking Alpha, levels at 12:31 ET on 10 November 2026. Past performance is not a reliable indicator of future results.
The US 10 year yield briefly moved above 5%. Admirals covered that threshold in an earlier piece on the 10-year Treasury yield and inflation fears.
Fed Rate Hike Speculation After the CPI
Fed rate hike speculation is the core of the USD/CAD story this week. A December move now looks likely to markets. The debate has shifted to its size.
Where the Fed Stands
The Fed raised its target range by a quarter point to 3.75% to 4.00% on 16 September 2026, according to its September FOMC statement. On 28 October it held the range by a 10 to 2 vote.
The two dissenters were Lisa D. Cook and Beth M. Hammack. Both preferred a quarter-point hike. The October statement said that inflation "remains elevated". Admirals reviewed that meeting in its note on the October Fed hawkish hold.
December Pricing After the Data
The next FOMC December 2026 meeting takes place on 8 and 9 December, according to the Fed meeting calendar. It is a meeting with fresh economic projections.
Source: Seeking Alpha, based on fed funds futures. Market pricing changes often. Forecasts are not a reliable indicator of future performance.
Fed rate hike odds after CPI can still move before December. The US October PPI is due on 13 November, per the BLS release schedule. US November payrolls follow on 4 December, according to the BLS employment schedule.
Recent US labour data have also been firm. Payrolls rose by 165,000 in October and unemployment held at 4.1%, according to the BLS Employment Situation report.
The Bank of Canada and the Canadian Side
The Canadian dollar has its own drivers. Canada's central bank is also raising rates. Canadian growth and jobs data look softer than in the US, however.
The October Bank of Canada Rate Hike
The Bank of Canada raised its overnight rate by 25 basis points to 2.5% on 28 October, according to its policy announcement. The Bank Rate is now 2.75% and the deposit rate is 2.45%.
The Bank said there "could be a need to increase the policy rate further". It added that it would proceed carefully given the uncertainty. The next Bank of Canada rate decision December 2026 is due on 9 December.
Source: Bank of Canada, 28 October 2026. Forecasts are not a reliable indicator of future performance.
Canadian Jobs and Inflation Data
The latest Canada jobs report was weak. Employment fell by 4,700 in October against forecasts for a gain of 13,600, according to FXStreet via TradingKey. It was the third straight monthly decline.
The unemployment rate rose to 6.7% from 6.5%, according to Trading Economics. That is the highest level since April.
Canadian inflation looks firm on the surface. Headline CPI rose to 3.1% in September, according to Trading Economics. Much of that came from petrol, which was up 27.8% on the year.
Canada core inflation looks softer. CPI excluding petrol rose 2.2%. The trimmed-mean rate was 1.8%, which is below the 2% target.
Sources: Trading Economics, Canada unemployment, Trading Economics, Canada inflation, Trading Economics news, FXStreet via TradingKey. Underlying data from Statistics Canada. Past performance is not a reliable indicator of future results.
This split matters for the loonie. Headline inflation is driven by energy. Core measures are close to target. This split could limit how far the Bank of Canada follows the Fed.
The US Canada Interest Rate Differential
The policy gap between the two central banks is wide. It may widen further if the Fed hikes and the Bank of Canada pauses.
Sources: Federal Reserve, Bank of Canada. Past performance is not a reliable indicator of future results.
Trading Economics linked the 10 November move to prospects of a wider rate differential. It also noted support for the dollar from carry trades into the US.
The latest rise in USD/CAD appears to have come mainly through US two-year yields. Weak Canadian jobs data and falling oil added to the pressure on the loonie.
Oil Prices and the Canadian Dollar
Oil prices and Canadian dollar moves are often linked. Canada is a major crude exporter. A drop in oil can weaken the loonie, and a rise can support it.
Sources: Khaleej Times, 3 November 2026, The Star, 10 November 2026. Past performance is not a reliable indicator of future results.
Brent fell 16% in the week to 6 November, according to Reuters via Khaleej Times. It was its steepest weekly drop since the start of the COVID-19 pandemic. Hopes of talks to end the conflict involving Iran drove much of the decline.
How Does Oil Affect the Canadian Dollar?
Energy is a large part of Canada's exports. Higher oil prices tend to raise export revenue and support CAD. Lower prices tend to do the reverse.
Oil can matter even when the wider dollar trend points the other way. On 9 November, USD/CAD rose even as the US Dollar Index fell 0.45%, according to FXStreet via TradingKey. Falling oil was one reason cited.
Oil also feeds Canadian inflation. The Bank of Canada says persistently high oil prices have kept headline CPI around 3%. Lower oil could ease that pressure and lower the odds of more Canadian hikes.
Admirals looked at the crude side in its note on Brent crude after the midterms.
USD/CAD Analysis: Technical Picture
The pair sits in the upper part of its one-month range. The levels below come from the sources cited and from official daily fixings. They are reference points only.
USD CAD Support and Resistance
Sources: investingLive, FXStreet via TradingKey, Trading Economics, Federal Reserve H.10 data (averages are our calculation). Past performance is not a reliable indicator of future results.
The 1.4286 level is the 70-cent mark for the Canadian dollar. investingLive described it as a sensitive level in Canada. A daily close above 1.4299 could bring the 1.445 to 1.47 zone into focus. A failure there could leave a lower high below the October peak.
Moving Averages From Official Fixings
The input data for this section are the Federal Reserve's daily noon buying rates in New York. They run to 6 November 2026, the latest date in the series at the time of writing.
Source: Federal Reserve H.10 historical rates for Canada. Averages are our calculation. Past performance is not a reliable indicator of future results.
Spot at 1.4215 sits above all three averages. A move back below about 1.4070 would put the pair under its short-term average again.
USD CAD 5 Year Performance
Recent moves look large in isolation. A longer view helps put them in context. The table uses year-end Federal Reserve noon buying rates.
Source: Federal Reserve H.10 historical rates for Canada, period 31 December 2020 to 6 November 2026. Changes are our calculation from the last available rate of each year. Past performance is not a reliable indicator of future results.
The pair has swung between gains and losses year by year. In 2025 it reached 1.4601 on 3 February and 1.3556 on 16 June. In 2026 its low so far was 1.3518 on 29 January. The October high in the same series was 1.4273.
What Drives USD CAD
Several forces push the pair at once. The table groups them by direction.
Admirals summary of the drivers described in this article.
Why Is USD CAD Rising?
The short answer is the rate outlook. Hot US CPI data raised Fed hike odds. Canadian jobs data were weak. Oil also fell. Together, these factors pushed the pair back towards 1.42.
What Could Help the Loonie?
A firmer Canadian CPI on 16 November could raise Bank of Canada hike bets. A rebound in oil could also help. Softer US data before December could cap the dollar. None of these is assured.
Key Events Calendar for USD/CAD
The pair faces a busy run of data before mid-December. Times are shown in US Eastern Time (ET) and UK time (GMT).
Sources: BLS PPI schedule, BLS CPI schedule, BLS employment schedule, Trading Economics, Canada inflation, Trading Economics, Canada unemployment, Bank of Canada, Federal Reserve. BoC and FOMC times are the usual announcement times.
The next US CPI release December 10 2026 comes the day after both central banks decide. Both central banks announce their rate decisions on 9 December. The Admirals forex calendar lists these releases with forecasts.
11 November is a holiday in both countries. Trading may be thinner than usual, which can make price moves less reliable.
USD/CAD Forecast and Scenarios
Forecasts differ in time frame. Recent momentum has favoured the US dollar. The Trading Economics model points to a slightly lower rate by year-end.
What Forecasters Expect
Sources: Trading Economics, Seeking Alpha, Bank of Canada, investingLive. Forecasts are not a reliable indicator of future performance.
The Trading Economics model sits below the current spot rate. It implies a modest decline by year-end. Model forecasts are often revised as new data arrive.
Illustrative Scenarios to Mid-December
The scenarios below are illustrative. They show how the pair could react to different outcomes. They are not predictions.
Illustrative scenarios by Admirals, based on the levels and data cited in this article. Forecasts are not a reliable indicator of future performance.
Risks on Both Sides
Admirals summary of the factors described in this article.
Prices can move sharply in either direction around central bank meetings. Two decisions on one day raise that risk. USD CAD volatility could rise around 9 December.
How to Trade USD CAD Around CPI Data
This section describes how some traders approach data releases. It is general information.
Before the Release
Many traders check the forecast and the prior reading before a release. They also note the times on the economic calendar. Some reduce their position size ahead of major data. The Admirals guide to forex fundamental analysis explains how data can move currencies.
- Traders often compare core CPI with the forecast first.
- Many traders watch the two-year Treasury yield for confirmation.
- Some traders wait for the first few minutes of volatility to pass.
- Others look at oil prices for the CAD side of the pair.
Managing Risk
Spreads can widen around major releases. Prices can also gap. A stop-loss order may be filled at a worse price than set in fast markets. The guide to forex risk management covers ways to manage risk.
- Leverage magnifies losses as well as gains.
- A stop-loss order can help manage risk, although it may not fill at the set price.
- Position size is often set as a small share of the account.
- Overnight positions may carry swap costs.
The guide on how to trade a Fed rate decision looks at central bank days in more detail.
Trading Instruments and Practice
Admirals offers CFDs on currency pairs, including USD/CAD. Its range also includes commodity CFDs, including crude oil. A USD CAD CFD lets a trader speculate on price moves without owning the currencies. Prices can move quickly, and losses can build fast.
A demo account uses virtual funds, and results may differ from live trading. Some traders use one to test how they react to data releases. The MetaTrader 5 platform offers charts and an economic calendar.
USD CAD Trading Hours
Forex trades around the clock from Monday to Friday. USD/CAD is usually most active when New York and Toronto are open. Many US and Canadian data releases come out at 08:30 ET. The guide to forex market hours explains the sessions.
Frequently Asked Questions
Why is USD/CAD near 1.42 today?
Hot US October CPI data lifted Fed hike bets. Weak Canadian jobs and lower oil weighed on the loonie.
What did the October 2026 US CPI show?
Headline CPI rose 0.4% and core rose 0.3% in October, both above forecasts of 0.3% and 0.2%.
Why was the annual US CPI rate missing?
October 2025 survey data were never collected during a government funding lapse, so annual comparisons were unavailable for most series.
When is the next Fed decision?
The Federal Reserve announces its next decision on 9 December 2026, at the end of a two-day meeting.
When does the Bank of Canada decide next?
The Bank of Canada announces its next rate decision on 9 December 2026, the same day as the Fed.
How does oil affect the Canadian dollar?
Higher oil prices tend to support the loonie through export revenue. Lower oil prices tend to weigh on it.
What are the key USD/CAD levels?
Resistance sits at 1.4286 and 1.4299. Support sits near 1.4077 and 1.4069, with the 1.39 area below.
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Sources
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- Two-year U.S. Treasury yield posts biggest one-day rise since 2024, Seeking Alpha, accessed 11 November 2026.
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- Canadian dollar touches an 18-month low as the US dollar jumps on hot CPI, investingLive, accessed 11 November 2026.
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- Oil falls almost 5% as Trump signals restraint on Iran, Khaleej Times, accessed 11 November 2026.
- Oil prices ease to nearly four-week low amid peace talks, Khaleej Times, accessed 11 November 2026.
